The markets weren’t shocked by last week’s wave of pre-broadcast S&P sovereign debt downgrades. For months, the question wasn’t “if” but “when.” And true to form, just as with the U.S. downgrade, S&P’s reasoning skated the surface of prevailing wisdom.Standard & Poor’s likes moving on Friday nights after the markets are closed.
The U.S. financial system remains unreformed, and no one in any position of power will do anything to fix it. The only question is when the bubble will burst.
The Volcker Rule has finally been approved by regulators, but with hundreds of pages of exemptions, too-big-to-fail banks have little to fear.
In the wake of the election, the Fed pulled off a move detected only by downtown Manhattan It quietly announced a purchase of $600 billion in Treasury securities (read: our debt) while pundits on the left and right were dissecting the role of the tea party in political life as we know it.